Transfer To LLC
I purchased a condo with cash from an equity loan from my own home and therefore the condo is in my name. The initial plan was to sell the condo to a recent LLC I created with my father-in-law and transfer the title to the LLC. I had 3 documents signed in front of a notary: promissory note, security agreement (to back note), and warranty deed. They are not recorded yet. Anyone have any opinions as to whether or not there are some clear-cut advantages to keeping the title in my name?
No advantages in my mind.
Another option instead of transferring to LLC, is setting up a Land Trust.
Disadvantage of keeping in your name is liability.
You may be able to transfer title for a pittance with the county, not sure about the rule of adding a person like father in law. , but I know you can add wife simply.
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I am buying my first rental property in my and my wife's names. Actually, I am in the process of buying 3, planning to buy more. Should I put the properties i LLC? What is Land Trust? What are the (dis)advantages?
Thanks.
For a good article concerning the different legal structures, check out A Quick Comparison of Real Estate Investing Business Entities in the articles section. The one entity missing from the list is the LLP.
One of the biggest disadvantges of having title under your LLC' name or in land trust will be this. If you want to refiance to get some cash out or try to get a home equity line. You will encounter some problems. There are some lenders who give mortgages to business entities, but usually with higher interest and lower loan to value. Regarding land trust, you have to take the property out of land trust, and have to be recorded before applying for any mortgage loan. (some lender may do it even with land trust, but of course with higher interest rate and lower LTV.
I'm currently in this situation , transferred my rental to a my LLC , in the refinancing my closing attorney say's the motgage can be recalled , my attorney say's no it can't since the LLC and myself are one in the same , no transfer has occured because I'm liable either way ? Any advise ?
Lucrativeone: my advice is to listen to your attorney. My question would be if you and the LLC were one and the same as far as liability on the note, why the transfer? Did you sign a personal guarantee?